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I like your analysis. One thing that may be missing is how much money flows between them.
by jedimastert 7y ago
I like your analysis.
One thing that may be missing is how much money flows between them.
- iNate2000 7y agoLike, existing deals, you mean?
- jedimastert 7y agoYeah, like if there's a contract between them or a regular amount of spending, that's an amount of money that IBM's saving each year, but that's also money that RedHat won't be earning each year. I don't know how important, percentage-wise, that number would be for either side. I imagine any amount of money would be a far bigger deal for RedHat than IBM.
- aksss 7y agoWell, it's a bit like renting an apartment vs paying down a mortgage, right? On the books they (IBM) will almost certainly still be paying the subsidiary (RH), and the subsidiary will still record and report the revenue. But IBM is now building equity with its payments up at the consolidated reporting level rather than shoveling the cash out the window.